Amazon Takes on Apple and Google with its $199 Color Tablet

On the corner of my desk sits an Amazon Kindle that is gathering dust. It has not been touched for a month.

I found it convenient but not compelling. It was great to download a book fast, but its cheap plastic feel, a clunky user interface and black and white screen made it rather unattractive. Using the Kindle was a bit like going back to watch black and white TV in a world of sexy, sixty inch, 3D color televisions.

The Kindle is a dedicated e-reader that was never meant to be a multi-function tablet. Its success along with the success of the Apple iPad has made Amazon realize that a tablet in its product range may be a vital and necessary addition.

The Apple has dominated the tablet market selling over 25 million iPads since the launch last year, which I am sure Amazon watched with extreme interest.

The iPad has also defined the new social mobile web where media, apps and browsing are mobile, enticing and even obsessive with the ability to login to Facebook and Twitter while out and about.

Amazon has just made an announcement of a new seven inch color tablet that could be the first serious indicator of a competitor that may potentially reduce Apple’s iPad table market dominance.

Amazon’s Tablet “Kindle Fire”

The $199 tablet has the following features.

Seven inch multi-color, multi-touch display

Wi-Fi connectivity

Weighs 14.6 ounces

Dual core processor

Web browser called Amazon Silk

What it doesn’t have is a 3G capability, a camera or a microphone. (See Video Demo of the “Kindle Fire”)

Amazon’s YouTube Video of the Kindle Fire

The Two Key Advantages of the Kindle Fire

The Amazon “Kindle Fire” tablet’s edge is two fold:

Its price, Jeff Bezos the CEO of Amazon says “we are building premium products at non-premium prices”

Its access to a store over 18 million digital books, movies, songs, magazines, apps and games.

Just like Apple, Amazon has a superior solution to hardware only brands such as HTC and Samsung, in that it has a total ecosystem that includes hardware, software and a Web-based store.

This announcement has just changed the tablet game and has just made every other Android tablet manufacturer’s tablet seem extremely expensive (for example HTC’s Flyer is priced at $499).

Implications for Google

What is also interesting is that Amazon even though it is using the Google Android operating system, has included its own browser called “Amazon Silk” that optimizes browsing for fast viewing of videos and games.

If the Amazon Fire becomes the dominant Android tablet, and the pieces of the puzzle and pricing seem to strongly indicate that, then Google will have to respond.

So what are the implications for Google?

Google will not control the Amazon Fire’s Browser

Apps will be sold through Amazon’s App Store not Googles Android market and that will dilute its revenue potential

Google may need to build its own tablet to compete with Amazon’s Fire, so as to grow its Android app store

Possible Impact on Apple

There are even rumours that Amazon will be also building a 10 inch tablet that will compete head to head with Apple’s iPad and if that is the case Apple will have to respond with lower prices which will benefit consumers.

The other implication for Apple could be the comission of 30% that it currently takes for its apps from developers could be cut if Amazon takes serious market share from the Apple iPad.

There is nothing like a bit of competition to reduce prices and improve a product!

I’m heavily considering it. I really like my Kindle Graphite and find it much better to read on than the iPad. Being able to download on the 3G connection anywhere in the world though is nice, and as I’m in Thailand, even in the city, wifi isn’t always available. And with books becoming more interactive having that connection to the Internet helps improve the experience.

Having said that though I think I’ll wait for the second version which I hear rumored not too far behind.

The Pedanticist

The size is OK for Facebook and Twitter and maybe a bit of reading. But it’s IO is limited – no videoout. No camera or mic in. And for a device that makes such a deal over access to the Cloud, not having 3G capability is a very poor decision.

http://twitter.com/marykeanedawson Mary Keane-Dawson

I agree with The Pendanticist – no videoout, recording capability, lack of 3G etc. rather limits appeal to serious social media users, and therefore I think it will sell well to a slightly older more down market demographic. Which opens up teh market further and enriches user expereince which can only be a good thing. It will be interesting to see how Amazon uses its customer segmentation data to target and sell the product. Equally, I also think Google will need a response strategy….it’s going to be a fun time in the run up to Christmas!

http://twitter.com/marykeanedawson Mary Keane-Dawson

I agree with The Pendanticist – however I can see that the product could appeal to an older, more down market demographic, and that could open up a whole new user base of socialistas. This will encourage growth and open up the market further, which is a positive and powerful strategy. It will be interesting to see how Amazon uses its customer segmentation data to sell the product. Google will have to respond – it’s going to be an interesting time in the run up to Christmas!

Anonymous

good one…

http://www.blake.co.za/blog/ Jade

Awaiting the Kindle arrival.

http://twitter.com/largepete largepete

I think that your Impacts on Apple aren’t very accurate. Even a 10 inch Fire isn’t a competitor to an iPad really. They have an awesome ecosystem for content, but I think that iOS will continue to dominate the apps market for a while longer. Many many apps will continue to be iOS exclusive. Therefore I really do not see Apple needing to lower prices to “compete” with the Fire.

Also your idea that Apple is driven by that 30% cut from apps is a bit off base. Apple makes the bulk of it’s profits from hardware, not iTunes. http://tech.fortune.cnn.com/2010/06/23/app-store-1-of-apples-gross-profit/ Loosing people to the Fire will hurt if they stop buying Apple hardware, but direct losses from the sale of apps isn’t going to influence much.

http://www.facebook.com/lyndsysimon Lyndsy Simon

I disagree with the idea that Google needs to have a direct competitor with their name on it. The Kindle Fire runs Android, though an un-branded version of it. It shouldn’t take long to get Google apps on there, for one.

For another, both Samsung and Acer are pushing very nice Android 3.0 tablets into the US market right now. They’re near the same price point, run Google-branded apps by default, and are the first generation to really give the iPad competition.

Google needed the Nexus One to drive the adoption on Android on smartphones. That’s done, and Android is now a natural choice for tablets. Google-branded hardware won’ tmake a bit of difference.

I used ipad and it’s the real products in the latest technological gift. I’ve just read about Kindle Fire and hope it also very impressive products though kindle can’t growing fast in previous product kindle 3. Thanks!

http://www.mazero.com/ Digital Asset Creation

Interesting stuff, thanks for this information. I’m sure that this tablet Color tablet will become popular and many costumers where become interested to buy this stuff.

http://www.mazero.com/ Digital Asset Creation

Interesting stuff, thanks for this information. I’m sure that this tablet Color tablet will become popular and many costumers where become interested to buy this stuff.